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Resources For

Pay & Leave Recruitment, Relocation & Retention Incentives

Overview

Recruitment, relocation, and retention incentives (3Rs) are compensation flexibilities available to help Federal agencies recruit and retain a world-class workforce. The 3Rs are administered under 5 U.S.C. 5753 and 5754 and 5 CFR part 575, subparts A, B, and C.

Compensation Policy Memoranda

Reports to Congress

Section 101(c) of the Federal Workforce Flexibility Act of 2004 (Public Law 108-411, October 30, 2004) required the U.S. Office of Personnel Management (OPM) to submit an annual report to specified committees of the United States Senate and the United States House of Representatives on agencies' use of the recruitment, relocation, and retention incentive authorities in 5 U.S.C. 5753 and 5754 during calendar years 2005-2009. The report provide data on and describe each agency's use of the incentives during the calendar year.

Non-GS Employees

Upon the request of the head of an executive agency, the U.S. Office of Personnel Management (OPM) may approve coverage under the recruitment, relocation, and retention incentive authorities of one or more categories of non-General Schedule employees in a single agency. (See 5 U.S.C. 5753(a)(1)(B) and 5754(a)(1)(B) and OPM regulations at 5 CFR 575.103(a)(7), 575.203(a)(7), and 575.303(a)(7).)

Agencies with one or more categories of non-General Schedule employees who are not specifically covered by the 3Rs regulations or an OPM approval may not provide 3Rs to these employees unless the agency has a separate statutory authority to do so. The statute must provide authority for the agency to grant payments similar to the 3Rs or additional compensation. A statute that only provides an agency with the authority to fix rates of basic pay for a category of employees would generally not be interpreted as providing authority to pay 3Rs payments because 3Rs are not considered rates of basic pay.

The following list shows the categories of employees OPM has approved to be covered by the 3Rs under 5 U.S.C. 5753 and 5754. The original approval date is in brackets after each category of employees.

Employees appointed under 5 U.S.C. 3161(b) in the Office of the Special Inspector General for Iraq Reconstruction [01/18/2006]

Employees of the Department of Defense National Defense University (including the Africa Center for Security Studies, the Center for Hemispheric Defense Studies, and the Near East South Asia Center for Strategic Studies) and the George C. Marshall Center for Security Studies whose pay is administratively determined under 10 U.S.C. 1595 [04/10/2006]

Defense Nuclear Facilities Safety Board

Professional and technical personnel paid under Section 161d of the Atomic Energy Act of 1954 (as amended by Public Law 101-510) [01/02/2008]

Education

Senior managers and technical and scientific employees in the Office of Student Financial Assistance Programs appointed and paid under the Higher Education Act of 1998 (Public Law 105-44) [09/30/1999]

Election Assistance Commission

Employees paid in accordance with section 204(a) of the Help America Vote Act of 2002 [10/08/2004]

Energy

Power system dispatchers [01/15/1993]

Wage board employees of the (1) Bonneville Power Administration whose pay is negotiated under the Bonneville Project Act of 1937 (16 U.S.C. 8321); (2) Southwestern Power Administration whose pay is negotiated under the Department of Interior secretarial Order No. 19865, August 31, 1943; and (3) Western Area Power Administration whose pay is negotiated under section 9(b) of Public Law 92-392 and section 704 of Public Law 95-454 [01/13/2000]

Scientific, engineering, technical, and professional employees paid under section 621(d) of the Department of Energy Organization Act (pay plan EJ), section 3161 of the National Defense Authorization Act for Fiscal Year 1995 (Public Law 103-337) (pay plan EK), and section 3241 of the National Defense Authorization Act for Fiscal year 2000 (Public Law 106-65) (pay plan EN) [05/22/2001]

Employees in the ER and ET pay plans established for Advanced Research Projects Agency-Energy (ARPA-E) [05/22/2012]

Exceptionally well qualified individuals in the EQ pay plan appointed under section 313 of division D of the Consolidated Appropriations Act, 2014 (Public Law 113-76), to scientific, engineering, or other critical technical positions. [6/25/2014]

Environmental Protection Agency

Employees appointed to a position under the administratively determined (AD) pay authority established by the Safe Drinking Water Act Amendments (Public Law 95-190, November 16, 1977) [08/21/2002]

Health and Human Services

Employees appointed to the Senior Biomedical Research Service under 42 U.S.C. 237 [04/20/1999]

Interior

Prevailing rate employees whose pay is negotiated under section 9(b) of the Government Employees Prevailing Rate Systems Act, Public Law 92-392, and section 704 of the Civil Service Reform Act, Public Law 95-454 [05/04/2001]

International Broadcasting Bureau

Non-U.S. citizen employees appointed under 22 U.S.C. 1474(1) and the Smith-Mundt Act (Public Law 80-402). Employees are excepted service paid under chapter 18 of title 22, United States Code (Public Law 101-249, February 16, 1990) [03/24/2003]

Justice

U.S Attorneys, Assistant U.S. Attorneys, U.S. Trustees, and Assistant U.S. Trustees [08/19/1991]

Millennium Challenge Corporation

Employees who are paid in accordance with section 617(d) of the Millennium Challenge Act of 2003 (Public Law 108-199, Division D), and who are not among the 30 for which pay is administratively determined under section 617(c) of the Act [03/24/2004]

Morris K. Udall Foundation

AD employees paid under 20 U.S.C. 5608(a)(1) [01/15/2009]

National Aeronautics and Space Administration

AD employees paid under 42 U.S.C. 2473(c) [09/18/1991]

National Science Foundation

Employees appointed under 42 U.S.C. 1864a and 1873(a) [10/22/1991]

Office of Personnel Management

Experts and consultants appointed under 5 U.S.C. 3109 whose pay is determined in accordance with 5 CFR part 304. [2/18/2014]

Overseas Private Investment Corporation

AD employees paid under 22 U.S.C. 2193(d) [08/07/1991]

State

Employees appointed under the Foreign Service Act of 1980 and U.N. Participation Act of 1945 [09/03/1991]

Treasury

National Taxpayer Advocate appointed and compensated under 7803(c)(1)(B) of the Internal Revenue Code of 1986, as amended by section 1102(a) of the Internal Revenue Service Restructuring and Reform Act of 1998 [08/08/1998]

Employees appointed and compensated under the streamlined critical pay authority at 5 U.S.C. 9503, as established by section 1201(a) of the Internal Revenue Service Restructuring and Reform Act of 1998 [08/08/1998]

Police officers in the Bureau of Engraving and Printing (BEP) and the U.S. Mint paid under 5 U.S.C. 5378 [10/19/2000]

USAID

Employees appointed under the Foreign Service Act of 1980 and section 625(b) of the Foreign Assistance Act of 1961 [07/31/1992]

Law and Regulations

FAQs

For the purpose of paying a retention incentive, rate of basic pay means the rate of pay fixed by law or administrative action for the position to which an employee is appointed before deductions and including any special rate supplement under 5 CFR part 530, subpart C, or similar payment under other legal authority and any locality-based comparability payment under 5 CFR part 531, subpart F, or similar payment under other legal authority, but excluding additional pay of any other kind. For example, a rate of basic pay does not include additional pay such as cost-of-living allowances or post differentials under 5 U.S.C. 5941, night shift differentials under 5 U.S.C. 5343(f) or environmental differentials under 5 U.S.C. 5343(c)(4). (See the definition of rate of basic pay in 5 CFR 575.302.)

Yes, provided all other requirements are met. For example, a temporary appointment must be for at least 6 months to meet the minimum period of employment required by 5 CFR 575.110(a) for a service agreement.

The service agreement may include any other terms or conditions that, if violated, will result in termination of the service agreement. For example, the service agreement may specify the employee’s work schedule, type of position, and the duties he or she is expected to perform. In addition, the service agreement may address the extent to which periods of time on detail, in a nonpay status, or in a paid leave status are creditable towards the completion of the service period. (See 5 CFR 575.110(f) and 575.210(f).)

If service with the agency (for a recruitment incentive) or at the new duty station (for a relocation incentive) does not begin on the first day of a pay period, the agency must delay the service period commencement date so that a required service period begins on the first day of the first pay period beginning on or after the commencement of service in the agency or at the new duty station.
An agency also may delay a service agreement commencement date until after an employee completes an initial period of formal training or a required probationary period when continued employment in the position is contingent on successful completion of the formal training or probationary period. The agency must make the determination to pay an incentive before the employee enters on duty in the position for which recruited or to which relocated. However, the service agreement must specify that if the employee does not successfully complete the training or probationary period before the service period commences, the agency is not obligated to pay any portion of the incentive to the employee. (See 5 CFR 575.110(b) and 575.210(b).)

For the purpose of determining the number of years in a service period, divide the total number of calendar days in the service period by 365 and round the result to two decimal places. For example, a service period covering 39 biweekly pay period equals 546 days, and 546 days divided by 365 days equals 1.50 years. (See 5 CFR 575.109(b)(3) and 575.209(b)(3).)

Before the employee enters on duty in the position for which recruited, or in the position in the new geographic area, the agency must determine that, in the absence of a recruitment or relocation incentive (as applicable), the agency would encounter difficulty in filling the position. An agency may determine that a position is likely to be difficult to fill if the agency is likely to have difficulty recruiting candidates with the competencies required for the position in the absence of a recruitment or relocation incentive based on the fact that OPM has approved the use of a direct-hire authority applicable to the position or on a consideration of the following factors:

The availability and quality of candidates possessing the competencies required for the position, including the success of recent efforts to recruit candidates for similar positions using indicators such as offer acceptance rates, the proportion of positions filled, and the length of time required to fill similar positions;

The salaries typically paid outside the Federal Government for similar positions;

Recent turnover in similar positions;

Employment trends and labor-market factors that may affect the agency's ability to recruit candidates for similar positions;

Special or unique competencies required for the position;

Agency efforts to use non-pay authorities, such as special training and work scheduling flexibilities, to resolve difficulties, alone or in combination with a recruitment or relocation incentive;

The desirability of the duties, work or organizational environment, or geographic location of the position; and

A retention incentive is an incentive an agency may pay to a current employee if--

The agency determines that the unusually high or unique qualifications of the employee or a special need of the agency for the employee’s services makes it essential to retain the employee and the employee would be likely to leave the Federal service in the absence of a retention incentive, or

The agency has a special need for the employee’s services that makes it essential to retain the employee in his or her current position during a period of time before the closure or relocation of the employee’s office, facility, activity, or organization and the employee would be likely to leave for a different position in the Federal service in the absence of a retention incentive.

No. DOD and Coast Guard NAFI employees must have a 90-day break-in-service to be eligible for a recruitment incentive upon movement to a position listed in 5 CFR 575.103 (unless one of the remaining exclusions in the definition of “newly appointed” applies).

Under 5 CFR 575.110(f) and 575.210(f), agencies may address the extent to which periods of time in a nonpay status or in a paid leave status (or paid time off status) are creditable toward the completion of an incentive service period and to determine whether recruitment or relocation incentive installment payments will continue as scheduled while an employee is in a non-pay status or paid leave status, with the exception of an employee who is on military leave without pay. An employee who is absent because of uniformed service is generally entitled upon reemployment to be treated as though he or she had never left. (See 5 CFR 353.107.) This means that a person who is reemployed following uniformed service receives credit for the entire period of the absence for the purpose of rights and benefits based upon seniority and length of service, including within-grade increases, career tenure, completion of probation, leave rate accrual, and severance pay. Therefore, the period of military LWOP is creditable toward the completion of a recruitment or relocation incentive service period, and scheduled recruitment or relocation installment payments specified in the service agreement must continue during the period of military LWOP.

Yes. An agency may pay a recruitment incentive to an employee who has not yet entered on duty if the individual has accepted a written offer of employment and has signed a service agreement. (See 5 CFR 575.109(d).)

Under 5 CFR 575.310(e), agencies may address the extent to which periods of time in a nonpay status (excluding military leave without pay) or in a paid leave status (or paid time off status) are creditable toward the completion of a retention incentive service period.
An employee who is absent because of uniformed service is generally entitled upon reemployment to be treated as though he or she had never left. (See 5 CFR 353.107.) This means that a person who is reemployed following uniformed service receives credit for the entire period of the absence for the purpose of rights and benefits based upon seniority and length of service, including within-grade increases, career tenure, completion of probation, leave rate accrual, and severance pay. Therefore, the period of military LWOP is creditable toward the completion of a retention service period.

Yes. However, an agency may not include in a group retention incentive authorization an employee in a senior-level (SL), scientific or professional (ST), Senior Executive Service (SES), Federal Bureau of Investigation and Drug Enforcement Administration (FBI/DEA) SES, or Executive Schedule (EX) position or similar categories of positions for which the payment of a retention incentive has been approved by OPM. (See 5 CFR 575.305(c) and 575.315(a)(2).) Retention incentives for employees in such positions must be approved on an individual, case-by-case basis.

In addition to the information listed in 5 CFR 575.310, the service agreement must also include-

The conditions under which the agency must terminate the service agreement under 5 CFR 575.315(g), including the conditions under which the agency will pay an additional retention incentive payment for partially completed service under 5 CFR 575.311; and

A notification to the employee that the agency will review the determination to pay the retention incentive at least annually to determine whether payment is still warranted.

No, in most situations. However, under 5 CFR 575.205(e), an agency may commence a relocation incentive service agreement during a period of employment established under a service agreement for a previously authorized retention incentive or for which an employee is receiving previously authorized retention incentive payments without a service agreement.

It is up to the agency to decide how long to set the service period for retention incentives. Since the reason for the incentive is to encourage an employee to remain with the agency, the agency should consider what service period length would best help achieve this objective, i.e., what the agency believes to be a reasonable period of service for the amount of incentive it is willing to pay. A service period under a service agreement for an employee likely to leave for a different Federal position may not extend past the date on which the employee’s position is actually affected by the relocation or closure of the employee’s office, facility, activity, or organization (e.g., the date the employee’s position moves to a new geographic location or the date the employee’s position is eliminated.)

Waiver requests must include a description of the critical agency need the proposed incentive would address, the documentation required for the agency's written determination to authorize a recruitment incentive under 5 CFR 575.108 or a relocation incentive under 5 CFR 575.208, the proposed incentive payment amount and a justification for that amount, the timing and method of making the incentive payments, the service period required, and any other information pertinent to the case at hand. (See 5 CFR 575.109(c)(2) and 575.209(c)(2).)